Tough one. If you want to take on the elders, give it a go. If nothing else it should open your fiancee's and your MIL's eyes to their hypocritical leadership. I've got some other worries:
she won't do anything against her mother
A marriage is a sacred vow that BREAKS the former bonds between parent and child. You need a helpmate, a support, in the storms of life to come. If your fiancee won't do anything against her mother, you are up for years of misery.
who will blindly do anything the elders say
Heck. See above.
How can I save my relationship and still keep my dignity by not giving in to the elders pressure
I think you need to work on your fiancee. If she can show some backbone, it can be the two of you against the world for the rest of your lives, and your manhood can be restored. Maybe try the "absence makes the heart go fonder" approach, found in any cheap romance novel. Girls always fall for this. This has a good chance of success, since the two of you have been intimate already, and have already formed a strong bond. The idea is to have a tearful, heartfelt departure from your fiancee. Make it romantic and memorable, nice restaurant or picnic in the park, candle-light, give and ask for a photo or memento. Tell her you cannot bear to be torn between her and the elders, and if she cannot go against their wishes, you must separate. Ask her not to call you for at least a week, but promise her that she will be on your thoughts constantly.
About a week later, "bump" in to her somewhere along her daily routine, look deeply in to her eyes, wait for it, the tingle of desire, and tell her how much you've missed her. Take it from there. Maybe have a spontaneous surprise waiting, like a ring and an application for a marriage licence, a list of local Justices of the Peace, clippings of starter homes from the local paper, a copy of "June Bride", something like that.
The truth is, since you are both DF'd, you can't get in much more ca-ca with the elders. If you off and elope, you can still work on reinstatement afterwards. What are they going to do, double-DF you?